FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 16: Process Costing and Analysis

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 51

True/False

Review LaterAdd Note

Review Later

If Department J uses $40,000 of direct materials and Department K uses $70,000 of direct materials, the following journal entry would be recorded by the process cost accounting system:

A) True
B) False

Correct Answer

verified

Show Answer

Question 52

Multiple Choice

Review LaterAdd Note

Review Later

A company that applies process costing is most frequently characterized by:

A) Low standardization and high production volume.
B) Custom orders and homogeneous products.
C) Repetitive production and heterogeneous products.
D) Repetitive production and low production volume.
E) Homogeneous product and high production volume.

F) C) and D)
G) A) and E)

Correct Answer

verified

Show Answer

Question 53

True/False

Review LaterAdd Note

The FIFO method of process costing computes equivalent units of production in a slightly different manner than the computation used in the weighted average method of process costing.

A process cost summary shows the cost of a particular job manufactured in the reporting period.

The three distinct groups of units which must be considered in determining the equivalent units of production under the FIFO method of process costing are: (a) _______________, (b) _______________, and (c) _____________________.

A manufacturing company may choose to use either a job order cost accounting system or a process cost accounting system, without considering the process it uses to produce its products.

A process cost summary is an accounting report that describes the costs charged to a department, the equivalent units of production by the department, and how the costs were assigned to the output.

A company uses a process cost accounting system. The following information is available regarding direct labor for the current year: $\begin{array}{ll}\text { Goods in process, January } 1 & 5,500 \text { units, } 80 \% \text { complete } \\\text { Goods in process, December } 31 & 8,800 \text { units, } 40 \% \text { complete } \\\text { Units completed and transferred to } & \\\text { finished goods } & 46,900 \text { units } \\\text { Direct labor costs during the year } & \$ 266,300\end{array}$ (a) Calculate the equivalent units of production for direct labor for the year using FIFO. (b) Calculate the average cost per equivalent unit for direct labor (round to the nearest cent).

Tanner, Inc. uses a process cost accounting system with Weighted Average valuation method. The following operating and cost data occurred during October: Materials are added at the beginning of the process. Direct labor and overhead are incurred evenly throughout the process. Prepare the October process cost summary.

A unique feature of process costing systems is the use of a single Goods in Process Inventory control account.

Describe the flow of labor in a process cost accounting system, including accounts used.

Which of the following characteristics does not usually apply to process manufacturing systems?

Job order manufacturing and process manufacturing are two major costing systems used in manufacturing. Briefly contrast the characteristics of these two systems.

A system of accounting in which the costs of each process are accumulated separately and then assigned to the units of product that passed through the process is a:

Process cost accounting systems consider overhead costs to include those costs that cannot be readily identified with any specific process.

Compare and contrast the FIFO and weighted average methods of process costing.

Direct labor and indirect labor are recorded, respectively, to:

Companies that use a series of manufacturing processes to produce standardized products should use a process cost accounting system.

If a department that applies process costing starts the reporting period with 100,000 physical units that were 20% complete with respect to direct labor, it must add 80,000 equivalent units of labor to complete them.

Refer to the following information about the Dipping Department of the Indiana Factory for the month of August: The cost per equivalent unit of materials is $10.00, and the cost per equivalent unit of labor and overhead is $22.00. -What total cost should be assigned to the units that were started and completed during August?